Boeing’s Latest 737 Order Worth $8.5 Billion

Boeing Commercial Airplanes confirmed a new order worth more than $8.5 billion to deliver 80 of its 737 MAX 8 narrow-body jets to SMBC Aviation Capital, one of the largest aircraft leasing agencies in the world. Among the U.S.-based carriers it supplies are Alaska Airlines, American Airlines, Frontier Airlines, and US Airways.

According to Boeing, this is the largest single order to date for the 737 MAX model from a leasing company. Deliveries will be scheduled between 2018 and 2022.

Boeing’s current forecast puts market demand for single-aisle aircraft at more than 25,600 jets over the next 20 years.

Like many carriers and leasing companies, SMBC is investing to update its aircraft portfolio to reduced fuel consumption as well as to meeting rising demand. The company currently has Boeing 737-800 and 14 737-700 aircraft, as well as more than 400 Airbus single-aisle aircraft. Earlier this year, SMBC ordered 110 Airbus A320neos and five A320ceos, for delivery between 2016 and 2022.

"It is 10 years since our business placed its first order with Boeing and we have enjoyed a decade of successful partnership since then," stated Peter Barrett, CEO, SMBC Aviation Capital.

He continued: "The 737 MAX 8 is one of the most fuel-efficient and versatile aircraft available and today's announcement shows our ongoing commitment to the new generation of the popular 737 family, as well as our appetite to keep broadening and deepening our platform in order to service our customers' requirements."

Boeing now lists more than 2,400 firm orders for the 737 MAX — a new series of jets due to become available in 2017. The 737 MAX will be the fourth generation in 50 years for the 737 family, the single-aisle aircraft that is the most widely employed model by commercial carriers.

Boeing Commercial Airplanes president and CEO Ray Conner called the new order “a vote of confidence” in the 737 MAX design that will help SMBC meet the strong demand in the single-aisle aircraft segment.

There will be three variants of the 737 MAX, all of them powered by the CFM LEAP 1-B engine, which is seen enhancing fuel efficiency by 14% over the current comparable 737 model, the 737 Next Generation.

The 737 MAX 8 is positioned as a replacement for the 737-800, with a longer fuselage than the 737 MAX 7, and a high-density configuration for up to 200 passengers in a single-class configuration.